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(Kitco News) - Comex gold futures prices are posting solid losses and hit a three-week low in early trading Wednesday. Bearish outside market forces—a stronger U.S. dollar index and weaker crude oil prices, are combining with a weak technical posture to put the gold sellers in command. June Comex gold last traded down $17.70 at $1,406.80 an ounce. Spot gold was last quoted down $17.30 at $1,409.00. July Comex silver last traded down $0.519 at $22.860 an ounce.

The surging U.S. dollar on the foreign exchange market and the weak raw commodity sector, in general, continue to be a bearish weight on the gold and silver markets. A news report overnight said a survey of fund managers showed the vast majority of those money managers are avoiding the raw commodity sector as an investment asset.

In other overnight news, the Euro currency fell and the U.S. dollar index rose to a nine-month high on news of a weaker-than-expected European Union gross domestic product figure. For the sixth quarter in a row, EU GDP came in at negative growth. First-quarter EU GDP came in at minus 0.2%, compared with the fourth-quarter of last year. The GDP data from the EU suggests the European Central Bank will keep its pedal to the metal on its aggressive easing of its monetary policy.

Meantime, the Bank of England Wednesday said the U.K. economy is in recovery, but it will be a very slow process that could force the BOE to implement more monetary stimulus measures.

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In Asia, the Japan Nikkei stock index pushed to a five-year high as the yen continues its descent versus the other major world currencies.

U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, the producer price index, the State manufacturing survey, Treasury international capital data, industrial production and capacity utilization, the weekly DOE energy stocks report, and the NAHB housing market index.

The London A.M. gold fixing is $1,412.25 versus the previous P.M. fixing of $1,433.75.

Technically, June gold futures bears have the solid overall technical advantage. Gold prices are in a seven-month-old downtrend on the daily bar chart. Bears' next near-term downside breakout price objective is closing prices below solid technical support at $1,400.00. A daily close below $1,400.00 would provide the bears with more downside momentum to then suggest a challenge of the April low of $1,321.50. The gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,450.00. First resistance is seen at $1,418.50 and then at the overnight high of $1,429.40. First support is seen at $1,400.00 and then at $1,390.00.

July silver futures bears have the overall near-term technical advantage as prices hit a three-week low overnight. Silver prices are in a seven-month-old downtrend on the daily bar chart. Bulls’ next upside price breakout objective is closing prices above solid technical resistance at $24.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at $22.00. First resistance is seen at $23.00 and then at the overnight high of $23.45. support is seen at $22.50 and then at $22.25.

Read the latest news in gold and precious metals markets at Kitco News.

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